A STRIKE looms at KSD municipality after workers were told they would not be paid at the end of this month.
Municipal manager Zizamele Mnqanqeni released a circular on Tuesday informing the municipality’s 2000 staff members they would not get paid.
Workers say they will down tools if there is no indication of a financial bail-out by next week to pay them.
Mnqanqeni blamed the situation on the millions paid to property developer Landmark over a bungled deal.
KSD paid R100-million to the company and the rest (R160-million) was paid by the provincial government in an effort to save the bankrupt municipality from total financial collapse.
“Cash flow challenges haunt the municipality after the debt was paid in October. The projections made indicate that the municipality faces challenges towards the end of 2013-14.
“This has since become a reality as collections, mainly from consumers, are declining significantly. Receipts from consumers are around R25-million to R30-million a month, whereas monthly payments are around R45-million to R55-million a month.
“The situation is becoming worse as balances on all accounts as of today sit at less than a million, with May obligations not paid in full.
“That means June 2014 will not be paid,” read Mnqanqeni’s letter to staff.
“It is against this background that you are hereby informed that salaries and allowances for the month of June will not be processed...
“You are therefore requested to bear with officials as the payment will be processed once an equitable share is paid the first week of July 2014.”
Included in the municipality’s list of financial blunders are two major contracts. The first is a fleet management contract worth R300-million with Makhubu Consortium, which is paid millions every month. The municipality spends millions more hiring vehicles and buying new ones although this is the responsibility of Makhubu.
In the third quarter of the current financial year, Makhubu was paid R9-million while the municipality spent more than R3-million on vehicle hire.
The second controversial contract is a R16-million CCTV contract with Cedza Technologies.
The Dispatch has also exposed how some officials milked the municipality’s finances by placing dead people on the payroll. Others, including cleaners and drivers, were being paid thousands in acting allowances each month.
On average KSD pays about R4-million in overtime every quarter.
Thousands are also paid to security companies every month despite unions objecting to “a wasteful expense”.
Mnqanqeni said the municipality needed to pay R14.4-million to Eskom, R9-million to other creditors and R2.6-million to Makhubu by tomorrow.
Yesterday the mayoral committee was locked in meetings with management and later with unions to try and find solutions to this problem.
Municipal spokesman Sonwabo Mampoza said: “The authorities are looking into the matter and interacting with the trade unions to find an amicable solution. We hope it will be resolved soon and we encourage workers to continue with their work as normal because the leadership is trying to ensure that staff get paid on the day. The community of KSD should not worry because the municipality will continue delivering services to them as normal.”
Mnqanqeni and KSD CFO Nomthandazo Ntshanga’s appointments have also been in the spotlight.
Mnqanqeni’s appointment was opposed by rival parties who felt he lacked qualifications and Ntshanga’s was done by Mnqanqeni without council knowledge. This led to the council appointing a multiparty task team to investigate her appointment. She was placed on extended leave but came back after pressure from former local government MEC Mlibo Qoboshiyane.
UDM councillor Ndiphiwe Mtwa blamed Qoboshiyane for KSD’s financial woes, saying he had “cheerled” for the two appointments.
Union representatives could not be reached for comment as they were locked in meetings with Ngqongwa. — abongilem@dispatch.co.za
Strike on the cards at KSD
Municipal manager Zizamele Mnqanqeni released a circular on Tuesday informing the municipality’s 2000 staff members they would not get paid.
Workers say they will down tools if there is no indication of a financial bail-out by next week to pay them.
Mnqanqeni blamed the situation on the millions paid to property developer Landmark over a bungled deal.
KSD paid R100-million to the company and the rest (R160-million) was paid by the provincial government in an effort to save the bankrupt municipality from total financial collapse.
“Cash flow challenges haunt the municipality after the debt was paid in October. The projections made indicate that the municipality faces challenges towards the end of 2013-14.
“This has since become a reality as collections, mainly from consumers, are declining significantly. Receipts from consumers are around R25-million to R30-million a month, whereas monthly payments are around R45-million to R55-million a month.
“The situation is becoming worse as balances on all accounts as of today sit at less than a million, with May obligations not paid in full.
“That means June 2014 will not be paid,” read Mnqanqeni’s letter to staff.
“It is against this background that you are hereby informed that salaries and allowances for the month of June will not be processed...
“You are therefore requested to bear with officials as the payment will be processed once an equitable share is paid the first week of July 2014.”
Included in the municipality’s list of financial blunders are two major contracts. The first is a fleet management contract worth R300-million with Makhubu Consortium, which is paid millions every month. The municipality spends millions more hiring vehicles and buying new ones although this is the responsibility of Makhubu.
In the third quarter of the current financial year, Makhubu was paid R9-million while the municipality spent more than R3-million on vehicle hire.
The second controversial contract is a R16-million CCTV contract with Cedza Technologies.
The Dispatch has also exposed how some officials milked the municipality’s finances by placing dead people on the payroll. Others, including cleaners and drivers, were being paid thousands in acting allowances each month.
On average KSD pays about R4-million in overtime every quarter.
Thousands are also paid to security companies every month despite unions objecting to “a wasteful expense”.
Mnqanqeni said the municipality needed to pay R14.4-million to Eskom, R9-million to other creditors and R2.6-million to Makhubu by tomorrow.
Yesterday the mayoral committee was locked in meetings with management and later with unions to try and find solutions to this problem.
Municipal spokesman Sonwabo Mampoza said: “The authorities are looking into the matter and interacting with the trade unions to find an amicable solution. We hope it will be resolved soon and we encourage workers to continue with their work as normal because the leadership is trying to ensure that staff get paid on the day. The community of KSD should not worry because the municipality will continue delivering services to them as normal.”
Mnqanqeni and KSD CFO Nomthandazo Ntshanga’s appointments have also been in the spotlight.
Mnqanqeni’s appointment was opposed by rival parties who felt he lacked qualifications and Ntshanga’s was done by Mnqanqeni without council knowledge. This led to the council appointing a multiparty task team to investigate her appointment. She was placed on extended leave but came back after pressure from former local government MEC Mlibo Qoboshiyane.
UDM councillor Ndiphiwe Mtwa blamed Qoboshiyane for KSD’s financial woes, saying he had “cheerled” for the two appointments.
Union representatives could not be reached for comment as they were locked in meetings with Ngqongwa. — abongilem@dispatch.co.za
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